The Pound has had a fairly good week or two against most major currencies, so I thought I would look at the probability that Sterling exchange rates would continue to gain ground against them over the course of this week.
Now that the Autumn statement has passed without any huge drama, unlike Kwasi Kwarteng’s attempt, there is a feeling that there is a little more confidence in the U.K and investors are starting to head back into UK stocks and shares, thus heightening demand for the Pound and increasing its value.
The week ahead is a really tricky one to work out, this is mainly due to the fact we have a short week in the U.S, with Thanksgiving over in the States on Thursday and very limited economic data across the globe for most of the trading week.
The key focus this week for the U.K and ultimately the Pound will be Wednesday, to be honest most of the main data for the week around the globe comes out on Wednesday and you may also see a little volatility on the Wednesday afternoon session as the U.S markets close off positions before they hit their Thanksgiving break.
Overnight on Tuesday we have the RBNZ interest rate decision over in New Zealand, for those looking to buy or sell New Zealand Dollars any change to the expectation of a 75 basis point hike could lead to sharp overnight movements for the NZD, or equally any surprising comments regarding future economic policy in the press conference thereafter.
Wednesday morning sees the PMI (Purchasing Managers Index) for the U.K for both services and manufacturing, so there will be a focus on this data to see how each areas has performed, expectation is for the pace of contraction to have quickened, we have similar data for the Eurozone and US with slightly better expectations but anything that differes from expectations or surprises the market could cause movements for GBP, EUR and USD over the course of Wednesday.
Wednesday afternoon brings a host of other data for the U.S ahead of thanksgiving, with durable goods, jobless claims and the FOMC meeting minutes all due out over the course of the afternoon.
I still feel that despite the pending recession and the gloomy outlook for the U.K that there is a little confidence returning due to the plans set out by the PM and Chancellor, and the fact that Sterling exchange rates are still reasonably low so the Pound can be acquired fairly cheap at present.
It would not surprise me to see the Pound continue to hold or even increase value this week, however any regular reader of this blog will be well aware that anything can happen and even a comment from a Bank Of England member or a surprise change in economic data could alter that expectation very quickly.
In such a volatile market it really is key you are watching rates very closely, if you would like assistance in doing so along with getting a comparison on any rate you are being offered to move money internationally then you are always welcome to contact me personally.
We pride ourselves on delivering up to date market information, award winning customer service and extremely competitive exchange rates, so if you feel you may not be getting any of this from your bank or current broker, then feel free to email me (Daniel Wright) on [email protected] and I will be happy to speak to you personally with absolutely no obligation to use us.